3 Issues Hospitals and Vendors Face Regarding Vendor Credentialing

Roughly four years ago, hospitals began requiring that medical sales representatives have a set of credentials in order to access their facilities. However, what credentials to have and where to store them has not been as clear cut, says Charlie Higgins, executive director of the Healthcare Manufacturers Management Council and the Health Industry Representatives Association. He shares three issues that hospitals and vendors need to resolve to establish a more free-flowing business operation.

1. There is no single set of credentials that are required by hospitals. Medical device companies and their sales reps must obtain several different types of credentials, such as training on HIPAA-related items, protocol for the operating room, inoculations, background checks, drug tests and others. However, there is no standardization among all hospitals of what vendors and sales reps actually need. While one hospital may require background checks, another may not, creating confusion and disorganization between hospitals and vendors.

Mr. Higgins says there should be a vendor-equivalent of the Joint Commission, which is the accreditation program that recognizes a hospital's performance standards. This could both standardize what is required of both hospitals and the vendors they interact with and assure there is a level of quality with all vendors involved.

"An ideal hypothetical situation is that all of the stakeholders — hospitals, credential companies, medical device companies, independent reps — agree on 10 or so things that would be the standard requirements for credentialing," Mr. Higgins says. "Standardization of requirements would give all hospitals out there a complete understanding of all reps that are calling on their facilities."

2. There is no central repository for credentials. Mr. Higgins says a lack of a credentialing database is also hindering seamless relations between hospitals and vendors. A central repository would serve several functions: It would house the credentials of all necessary sales reps and other personnel; vendor credentialing companies could access the credentialing data for all personnel; hospitals would have the ability to track who they are dealing with; and it would provide security to vendor reps that their information is safe and not being misused.

He adds that hospitals are able to view physicians' board credentials through a central repository, and a similar capability with hospitals and vendors could make future business transactions simpler and more efficient. "If you are a physician in the U.S. and you want to move from one hospital to another, you tell your new hospital, 'All of my credentials are in the databank,'" Mr. Higgins says. "They look it up, see where you got your undergrad, where you went to med school and other required training and information. Why can't we have something like this?"

3. There is no standard charge currently made by the various credentialing companies. Mr. Higgins says there are nearly two dozen credentialing companies for vendors to keep track of, and many charge different rates. Some companies such as Vendormate charge one-time fees for vendor sales reps per hospital, and others charge on a per hospital basis. Still others charge based on hospital-required credentials. He says the issue is not the actual payment — it's the fluctuation. "No one wants to dictate what someone can charge — the market will do that," Mr. Higgins says. "If you take an organization like Johnson & Johnson or Medtronic, who have thousands of sales reps [with varying charges], it's a very costly program. But for small companies, this puts them at a disadvantage in the marketplace, and the independent reps have to take all of these costs out of his or her pocket."

"We have no issue with credentialing, per se, or paying for it," he adds. "We're just trying to make it uncomplicated, manageable and affordable."

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